Destination India

New Delhi: Serving under-served routes in India is paying rich dividends for Tony Fernandes’ AirAsia. Can the largest low-cost carrier in South-East Asia stay ahead of rivals? Tiruchirappalli or Trichy lies somewhere in the middle of the highway that connects Chennai with Kanyakumari, the southernmost tip of the country. It is a hub for industrial engineering, houses a number of institutions of higher education — some of them over a hundred years old — and is famous for its temples. It is an ancient city and the fourth-largest urban centre of Tamil Nadu. Still, it is an unlikely place for an aggressive international budget airline to start its Indian operations.
But that’s precisely what AirAsia, the largest low-cost carrier in South-East Asia, has done. It found that people from Trichy travelled first to Chennai and then took a connecting flight to destinations like Singapore, Kuala Lumpur and Bangkok. It was expensive, and it wasted a lot of their time.
AirAsia moved quickly to plug the need gap. And it has done so in its signature style: It has mounted no less than 10 weekly flights from the city to Kuala Lumpur; and the average return fare is Rs 12,000 — almost half of the Rs 21,000 that it cost earlier. And while Air India Express, the low-cost arm of state-owned Air India, has now matched the AirAsia fare, it does not offer a direct flight and has a stopover at Chennai. The news is that all of AirAsia flights are choc-a-bloc. Trichy could one day make it to a business school case study.
Having discovered Trichy, Anthony Francis “Tony” Fernandes, the maverick promoter of AirAsia, is not taking life easy. He means serious business. Last week, AirAsia launched a daily Airbus A-330 flight from Delhi to Kuala Lumpur at a basic fare of, hold your breadth, just Re 1 for two days. After taxes and other charges, the price to the traveller comes to Rs 1,633 for a one-way ticket — nearly one seventh of what you would have to fork out for a direct flight on any other airline.
16/08/10 Surajeet Das Gupta/Business Standard

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Categories: Foreign Aug 2010, Low Cost General Aug 2010